Income Tax Appellate Tribunal - Jaipur
Ghanshyam Das Jethwani vs Assistant Commissioner Of Income Tax on 9 February, 2000
ORDER
C.L. Bokolia, A.M.
1. The appellant has moved an application under s. 254(2) of the IT Act stating that in the order passed by the Tribunal ITA No. 1184/Jp/1997, dt. 11th August, 1999, some rectifiable mistakes apparent on the face of record have crept in and, therefore, same require to be rectified in terms of s. 254(2) of the IT Act.
2. At the time of hearing of this miscellaneous application, our attention was drawn by the learned authorised representative towards the specific pages of paper book and specific reference from the arguments made through written brief to contend that mistakes were apparent, based on erroneous assumptions and due to ignoring specific material on record. Reliance was also placed on certain decisions to support the contentions that such mistakes are rectifiable, viz., CIT vs. Shakuntala Rajeshwar (1986) 160 ITR 840 (Del), CIT vs. Mitha Lal Ashok Kumar (1986) 158 ITR 755 (MP), S. B. Singar Singh & Sons vs. ITAT (1965) 58 ITR 626 (All) and Mangat Ram Kuthiala (Decd.) & Ors. vs. CIT (1960) 38 ITR 1 (P&H).
3. The learned Departmental Representative, on the other hand, made the general arguments in respect of the provisions of s. 254(2) and powers of the Tribunal. He mentioned that mistakes may be there but they need not be apparent rectifiable under s. 254(2). Written submissions were also filed making a general commentary in relation to provisions of s. 254(2). Through these submissions, reliance was placed on the decision cited at Maharana Mills (P) Ltd. vs. ITO (1959) 36 ITR 350 (SC), T. S. Balram, ITO vs. Volkart Bros. & Ors. (1971) 82 ITR 50 (SC), Sagar Co-operative Central Bank Ltd. vs. CIT (1990) 186 ITR 292 (MP), CIT vs. K. L. Bhatia (1990) 182 ITR 361 (Del), CIT & Anr. vs. ITAT & Anr. (1994) 206 ITR 126 (AP), Ram Kumar Jalan vs. ITO (1998) 61 TTJ (Mumbai) 296 : (1998) 66 ITD 576 (Mumbai) and other decisions. It was contended that rectification of mistakes would tantamount to review, which the Tribunal is not empowered to do. However, the learned Departmental Representative did not make any specific argument in relation to six specific mistakes pointed out by the learned authorised representative.
4. We have carefully considered the rival submissions, material on record and the decisions relied upon. The Tribunal has power to rectify but does not have the power to review. An error of judgment cannot be rectified but a mistake, which is prima facie apparent, is rectifiable. Even the judgments relied upon by the rival parties contain similar views. Neither it cannot be said that the Tribunal can rectify all types of mistakes, nor it can be said that the Tribunal cannot rectify any mistake in its order. This depends upon the nature of particular mistake examined in light of relevant facts. If the mistake falls under the category of rectifiable mistakes, the Tribunal is empowered to rectify the same. Rather, the Tribunal is duty bound to do so when pointed out. On the other hand, however, substantially the mistake may be, the same is not rectifiable if it does not fall in the category of rectifiable mistakes. In this connection, we feel it reasonable to refer the decision of Mumbai Bench, (1998) 61 TTJ (Mumbai) 296 : (1998) 66 ITD 576 (Mumbai) (supra) and relied upon by the learned Departmental Representative at pp. 297 & 298 it states :
"The Tribunal has, by virtue of the provisions of s. 254(2), powers to rectify a mistake found to be borne out from its order but it is also a settled law that such a mistake must be one for the discovery of which no long drawn process of reasoning or in-depth is required. Sec. 254(2) makes it clear that a mistake apparent from the records is rectifiable but in order to bring the mistake within the ambit of these provisions the claimant has to prove that there exists a mistake and is, prima facie, apparent from the records, meaning thereby that a mistake coming within the ambit of this provision must first of all exist and consequently must be prima facie apparent one. The 'mistake' means to take as understand wrongly or incorrectly, to make an error in interpreting, is an error, a fault, a misunderstanding or misconception. Unless and until the mistake claimed by the party falls under any of these categories, it cannot be termed as mistakes or at least mistake apparent from record."
5. This, one has to check up as there is a mistake at all and if it is there, one has to decide as to whether it is falling in the category of rectifiable mistake.
6. The first mistake arises out of para 11 of the order in question. It is mentioned that the jewellery declared in the wealth-tax return has been treated as explained by the AO. Therefore, no relief is being granted anymore. The learned authorised representative has now shown us that neither the AO, nor the first appellate authority has granted the credit for jewellery disclosed in wealth-tax return. From p. 5 of the order of CIT(A), we find that our assumption was wrong. Our assumption was based on the conception that usually the credit is being allowed by the authorities for jewellery disclosed under wealth-tax returns. We, therefore, direct that the credit for the jewellery disclosed in the wealth-tax return of the assessee is allowed to it. This rectifies decision in para 11 of our order.
7. The second mistake pointed out is that in para 13, the Tribunal observed that Panchnama does not include the jewellery on person of Shri Anand. We find that on paper book p. 9, copy of Panchnama was available and item No. 22 evidently shows the caption that jewellery has been inventoried from the person of Shri Anand. Therefore, this is also apparent mistake, not requiring any further debate or discussion. We direct that the credit is allowed of the jewellery on person of Shri Anand as per the Panchnama and to that extent, no addition should be made. The AO is directed accordingly. This rectifies para 13 of our order.
8. The third mistake arises from para 14 where Tribunal presumed that the credit of jewellery received from the will of late Smt. Rajshree Jethwani stands allowed in case of Smt. Sarla Jethwani, whose case has become final under KVSS. The Tribunal, therefore, did not allow any credit in the present case, assuming that it would result in allowing double credit. However, paper book pp. 101-104 containing the assessment order of Smt. Sarla Jethwani shows that said credit was not allowed to Smt. Sarla Jethwani. This means that neither assessee nor Smt. Sarla Jethwani were allowed the credit in respect of jewellery received through will of Smt. Rajshree Jethwani. Evidently, the decision of Tribunal is based on mistaken assumption, which is rectifiable. We, therefore, feel it appropriate to direct the AO to allow the credit of jewellery received through will of Smt. Rajshree in the hands of the assessee and delete the addition of corresponding amount.
9. In relation to the fourth mistake, however, we are unable to appreciate the arguments advanced by the learned counsel. There is no error at all in writing that the search at the business premises of the firm and at the residential premises of partners took place simultaneously and hence the surrender was also made simulatneously. This appears to be rather a correct fact. We, therefore, decline to rectify anything in relation to this point. Whether the surrender made by the firm was available to the partners or not is, however, a different issue being decided on other relevant material. We hold accordingly.
10. The next mistake has also been pointed out in para 18 of the order. It was observed that "No details of any surrender made in the case of firm placed on record." Based on this observation, the Tribunal denied any credit in the hands of partners in relation to said surrender. During the arguments, reference was made to the details of surrender in the hands of firm at paper book p. 54, where the statement of partner being the assessee is available making the surrender in the hands of the firm. The statement also reveals that surrender made in the firm took into account the undisclosed jewellery of partner. Further, the assessment order of the firm M/s. D.B. Jewellers was also placed in paper book. The said assessment order, at paper book p. 60, shows the details of surrender. The Tribunal overlooked the said references in the two documents and we have no hesitation in accepting that this is a prima facie apparent mistake in the order. Since the details of surrender and addition, both were available on record, our observation that no details were available, was incorrect, Consequently, the conclusions in para 18 are based on mistaken assumptions. We consider that this is also a rectifiable mistake. Out of the amount surrendered and addition made, Rs. 91,000 remained invested in the stock of the firm. The remaining amount was available to the two partners of the firm. Assessee being a 50 per cent partner, 50 per cent of the remaining amount of addition finally sustained in the hands of the firm was available to him. The AO is directed to allow the credit of this amount to the assessee against the alleged unexplained jewellery, worked out after giving effect to this order. The source to this extent stands explained in his hands. This modifies our observation and decision in para 18 of the order. We hold accordingly.
11. Having decided the issue relating to mistake No. 5, no discussion is required in relation to sixth mistake pointed out by the learned counsel.
12. Subject to the above observations, the Miscellaneous Application filed by the assessee is allowed.